Commentary on Political Economy

Saturday, 4 February 2012

Reason and Revolution - The Role of Crisis

The chief result of our study of Weber’s theory of
“rationalization” so far is that it is not and cannot be “scientific” because
its “unit of measurement” relies on the homogeneity of “labor”. Weber ignores
the fact that living labor is not and cannot be homogeneous for at least two
reasons: the first is that it is impossible to divide social labor into
“individual labors”; the second is that the maker of a pro-duct should never be mistaken with the product itself! And the third reason is that, in any case, even if “individual labor” is
“measured” in terms of “output” by means of sheer violence, as in the capitalist labor process, that “output” is not “homogeneous” across
product industries (as even the greatest bourgeois economic theoreticians
concede – see Chamberlin and Robinson and Sraffa on “imperfect competition”) so that it cannot serve as a "measure" on which this output can be "priced" for market exchange!
It is for this reason that both Weber and Marx rely ultimately on fiction of “the
self-regulating market” (the law of supply and demand) to determine “the exchange value” (the prices)
of output and to provide “the social synthesis”, or the “co-ordination”
necessary for the “reproduction” of the society of capital. (Hayek’s entire
work was dedicated to this conundrum of how a mass of atomized individuals can
reproduce a society through “the market”. That the paramount and insurmountable
problem, the impasse, of the Economics is precisely the “co-ordination of
economic activity” is also cleverly perceived, acknowledged and intelligently
discussed by Brian Loasby in Equilibrium
and Evolution. Our own discussion of these matters will be the subject of a
forthcoming study called Catallaxy:
The Bourgeois Utopia of Equilibrium.) Marx’s inability to determine “value” and
“prices” independently of the market “mechanism” induced him to seek the
“objectification” of value in the “fetishism of commodities” which served the
same purpose as Weber’s “rationalization” – that of “measuring” the social
synthesis, which is what Lukacs translated into the concept of “reification”.

Just as with Weber’s “rationalization”, the Marxian concept
of “commodity fetishism” or the Lukacsian equivalent of “reification” simply
cannot account for “the social synthesis”. Marx and Lukacs understand that if
this “social synthesis” is objectively
valid – if, in other words, it is possible “to measure” value independently
of political institutions, of violence -, then capitalism would be made
“scientifically legitimate” and the only “objection” to it would rest with the
“efficiency” as a mode of production of social wealth. If, on the contrary,
this “social synthesis” is achieved through a “necessary illusion” (fetishism
of commodities, reification, formalism), then we have a contradiction because
no “fiction” can keep a social system in “reproduction” – let alone a
“necessary fiction”, which is an oxymoron! (We dealt before with Lukacs’s
description of “necessary illusion” – which is an oxymoron because “illusions”
cannot be “necessary” and “necessity” cannot be “illusory”.)

Lukacs perceives this problem when he asserts, albeit still
from the viewpoint of the opposition of “fragmented alienated labor” against
the “(lost!) totality of artisanal
labor”, that “the limit to reification is its ‘formalism’” (in HCC, p.101). Habermas understands
Lukacs’s statement to mean that workers understand that the “reification” of
labor time is “an illusion”, however “necessary” it may be “objectively” and
that therefore the bourgeoisie cannot be “the individual subject-object of
history”. As if “history” required anything like “individual subject-objects”
for exploitation to occur! (Nietzsche would have a fit if he ever read Lukacs!)
Quite obviously, Lukacs’s analysis does not deal with the problem because, as
Habermas rightly notes, this “formalism” can be overcome only “philosophically”
– through “class consciousness”, which entails opposing one “illusion” with
another (as the old Frankfurt School realized, only to preserve the idolatry of
“[Instrumental] Reason”). [See Habermas, Theory
of Communicative Action, Vol.1.] The only way to lend validity to Lukacs’s
position is to reflect that the “formalism” of reification, of the mythical law
of value, will defeat capitalism for the precise reason that what makes it possible is a reality of “antagonism”,
of capitalist command over living labor that ensures its “abstraction”. In
other words, there is no “real” or “necessary” illusion behind reification but
the naked blunt violence of the capitalist – “the discipline of the factory”.
This is why “formalism” is the limit of capitalism: - because “rationalization”
is not an “objective” (Weber) or merely “ideological” (Marx-Lukacs, then
Heidegger-Marcuse) phenomenon, but rather (with Nietzsche’s invariance, the
“unreality” of values) an “arbitrary” one that responds to a strategy of command and exploitation.

It must be stressed that capitalism in its guise as “social
capital” becomes as much a “mode of consumption” as it is a “mode of
production”. This is intuited by Weber and then “theorized” by Keynes in terms
of the money-wage as the fundamental unit of measurement in capitalist
industry. Capital must impose not just its “mode of production” through the
labor process and technologies used in the production process; it must also impose
and define “the mode of consumption” for workers so that their living labor may
be “rationally calculable” according to the law of value and the equalization
of the rate of profit! But careful! The mode of consumption “closes the circle”
of the circulation of capital, of valorization, - which does not mean that the
“foundation” of capitalism is not “the wage relation”, that is, the process of
production first and foremost, “the regular discipline of the factory”.
Consumption simply allows that “osmosis” that makes antagonism “measurable” after the event, as “realization” of
what had preceded as “valorization” of capital, as “profit” and provides that
“sphere of autonomy” to workers (Weber’s “free labor”) – through “the market”
and the welfare state or Sozialstaat – that supplies “the unit of
measurement”, the money-wage acting as a “social wage” that ensures the
“reproduction” of the wage relation.

This solves the conundrum of “the affluent society”, the
seeming integration of workers in the society of capital that Habermas
correctly identifies as the overriding theoretical concern of Western Marxism
since Lukacs. This is the apparent paradox (apparent even to Tocqueville [Democratie en Amerique, Livre IV, chpts.
6 to 10] and Arendt [discussion in Negri, ‘Insurgencies’, ch on
‘Pol.Eman.inAm.Const.’, who does not see the point] to Marcuse and Baran and
Sweezy) of the “apathy” of workers in the face of “material (consumption)
affluence” – the “welfare state” or Sozialstaat fully implemented under the New
Deal. Those who accept “un-critically” the notion of “integration” (see
especially Marcuse’s One-Dimensional Man
or even the “cultural” pages in Baran and Sweezy’s Monopoly Capital) have effectively forgotten Schumpeter’s great
discovery (adopted wholesale from Marx) that capitalism is “crisis”, that it is based on antagonism. “Crisis” does not just mean a “dysfunction” in the “production” of
value or profit, as if these were “quantities” rather than “social relations”
that need special political intervention (regulation) to avoid “crises”. Crisis
is not something that happens “occasionally” or “accidentally” or “exogenously”
or “by mistake” because of failure to apply the “correct economic measures or
policies”. Crisis is instead the perennial,
fundamentalimpossibility of
measuring social antagonism in monetary terms, which is due to the incongruence
between production and consumption derived from the corresponding impossibility
of making “value in production” equal “value in consumption”. The problem is
not that “there is not enough profit” (overproduction) or “not enough demand”
(underconsumption): the problem is that “profit” and “value” can no longer be
“measured” monetarily whenever the “political equilibria” (the only
“equilibria” that are possible) explode in a full-blown crisis. (See below, quote from p.312.) That is why Joan
Robinson, with characteristic genial intuition, preferred to speak of “tranquility” rather than “equilibrium”
as a category of economic analysis (in The
Accumulation of Capital).

The “apathy” and “integration” of workers is a direct result
of the “division” of social labor into “individual labors” remunerated or
rewarded with “individual money-wages” and the corresponding “concentration” of
monetary social resources in the “central government” which then uses the
existing structure of government administration to impose its “constituted
power”. This is achieved through various strategies that include various
degrees of political “violence”, from physical all the way to “cultural” and
propagandistic violence. Thus, the “Sozialisierung” that Weber considered to be
a result of “rationalization” simply cannot be explained unless we penetrate
and enucleate – explode – this notion by removing it from the field of
“science” and by re-interpreting the entire notion of mathesis, of Kalkulation,
of “profit”. Weber’s account (for it cannot be called a “theory”) of the Rationalisierung yields, as we have
seen, a notion of “freedom” that is confined to rational-technical instruments connecting available means
to proposed ends that far from being “scientifically” indicated by “axiomatic
disciplines” based on “ideal types”, fail to specify the conditions under which
the means are “available” and the ends are “proposed”. Ultimately, Weber has to
postulate the “purposive rationality” of human “free will” that arises not from
its idealistic universality (as in German Idealism and in jusnaturalism) but
rather from the very “conflict”, as the resultant of “the clash of wills” that
he (like Nietzsche) sees as a “universal condition”.

What we need to
delineate therefore is a new strategy of emancipation from the wage relation, a
fresh notion of “political freedom” that supersedes the economic-political,
historical-materialist “rupture”. The society of capital is far from “free
from difficulties”. The “crises” that it experiences regularly are really the
most “visible” manifestations of its underlying antagonism. Indeed, it may even
be said that even the “absence” of conspicuous open conflict may be a sign that
explosive antagonism is being “swept under the carpet” or “repressed” until it
reaches the point of social explosion, of open revolt and revolution. This is
precisely what is happening at the moment with the evident decline and
“implosion” not just of the “financial system”, but also of the parliamentary
“partitocracy” that has dominated government in advanced industrial capitalist
countries since the New Deal Settlement. (See on all this, Jean Meynaud, Les Pouvoirs de Decision dans l’Etat Moderne.)